Donald Trump has renewed his attacks on Federal Reserve Chair Jerome Powell, demanding swift interest rate cuts and even suggesting Powell should be removed from his position. The former president’s criticism came after Powell reaffirmed the Fed’s independence in a speech in Chicago.
Trump Slams Fed’s “Wait-and-See” Strategy
In a Truth Social post early Friday, Trump criticized Powell’s approach to monetary policy, labeling the Fed’s recent communication as a “complete mess.” He argued that inflation is now under control and used the European Central Bank’s expected rate cuts as justification for similar action in the U.S.
“The ECB is expected to cut interest rates for the 7th time, and yet, ‘Too Late’ Jerome Powell of the Fed, who is always TOO LATE AND WRONG,” Trump posted. “Powell’s termination cannot come fast enough!”
He also touted that the U.S. economy was “getting RICH ON TARIFFS,” implying further justification for loosening monetary policy.
Powell Defends Fed Autonomy
Speaking at the Economic Club of Chicago, Powell emphasized that the central bank’s independence is legally enshrined and enjoys bipartisan support. He made it clear that political pressure would not influence monetary decisions.
“Our independence is a matter of law,” Powell stated. “Congress has, in our statute, we’re not removable except for cause.”
He continued, “We’re never going to be influenced by any political pressure. People can say whatever they want. We will do what we do strictly without consideration of political or any other extraneous factors.”
Trump’s Repeated Push for Rate Cuts
Since returning to office for a second term, Trump has been vocal in his demands for the Fed to lower interest rates. During a virtual appearance at the World Economic Forum in January, he insisted that low oil prices justified immediate rate cuts to fight inflation.
Following the Fed’s decision to keep rates at 4.25%-4.5% despite inflation sitting at 2.9% in December, Trump lashed out on Truth Social. He claimed that energy expansion, deregulation, and trade adjustments would solve the country’s economic issues more effectively than current monetary policy.
More recently, Trump linked rate cuts to mitigating the economic impact of his proposed tariff increases.
White House Eyes Fed Chair Succession
U.S. Treasury Secretary Scott Bessent revealed that the administration would begin interviewing candidates to replace Powell once his term ends in May 2026. Despite Trump’s vocal criticisms, Bessent affirmed his respect for the Fed’s independence and stated he remains in regular contact with Powell. He also added that there’s no indication of financial instability requiring emergency intervention.